The Telecom Regulatory Authority of India (Trai) had written to the telecom department (DoT), saying the agreement between the two companies was against the spirit of the MNP rules offering voluntary porting. It would lose fees that each mobile phone operator pays to the government while processing a porting request.

Trai also refers to the porting fee paid to the MNP service provider. As per MNP rules, fee of Rs. 19 is charged for every porting subscriber. Loop is going to transfer 2.9 million customers, so the total revenue is about Rs. 5.5 cr. And the MNSP must pay 1 percent revenue share to the government.

Earlier on February 18, Bharti Airtel had announced the Rs 700 crore acquisition of Loop Mobile. Under the agreement, Loop's 3 million subscribers in Mumbai will join Airtel's over 4 million subscribers. It will also bring together Loop Mobile's network supported by 2,500 plus cell sites and Airtel's network supported by over 4,000 cell sites across Mumbai.

The authority said that Loop’s subscribers must be informed that the company is closing up shop, and told to port out voluntarily and also the customer acquisition must be verified by the operators before activating a number.

Trai was factually incorrect in saying that Airtel was acquiring any resources of the government, the official added. "Loop's licence and corresponding rights to use spectrum are soon expiring, so Airtel is not really acquiring any resources of the government," the official said, Reports ET, (The Economic Times, India's largest Economic daily).